This Week's Poll

Should Virginia's legislature raise the gas tax to pay for road improvements?

I have no idea
No
Yes

You must be logged in to vote.

Home > Top > Dulles hotel market solid: Despite economic slowdown, more hotel construction is in the works
Two hotels -- aloft Dulles-North and Hilton Garden Inn -- are under construction at Flagstaff Plaza in Ashburn. Times-Mirror Staff Photo/Elizabeth Dodd

Dulles hotel market solid: Despite economic slowdown, more hotel construction is in the works

Although the real estate industry has slowed to a crawl, hotel growth in the Dulles corridor remains healthy.

Several developers have recently applied to build hotels along the corridor – an area of Sterling, Reston, Herndon and Chantilly, generally following Route 28 and the Dulles Toll Road.

One development company, Buccini/Pollin is in the process of building two hotels in the Dulles Corridor – aloft Dulles-North, a W Hotels brand, and Hilton Garden Inn Washington Dulles North.

The aloft Dulles, which is scheduled to open in November, is a 136-room hotel designed with urban influences and high-tech amenities at Flagstaff Plaza in Ashburn. Next to aloft is Buccini/Pollin's Hilton Garden Inn, a 135-room mid-priced hotel.

According to a Lodging Property Survey by Randall Travel Marketing in 2006 for the Loudoun Convention and Visitors Association, 86 percent of the 4,439 hotel rooms in the county are in the Dulles and Route 7 corridors. Those rooms collect more than 90 percent of the lodging taxes generated by the county.

"Tourism is an important industry in Loudoun County," said Larry Rosenstrauch, director of Loudoun County Department of Economic Development. "We are not saturated [in hotels]."

Rosenstrauch added that he often hears from business leaders that they want to see some full-service hotels offering a place to eat, sleep and hold meetings.

Some of that growth can be attributed to an airport that is also growing, said Eileen Curtis, president of the Dulles Regional Chamber of Commerce.

The Metropolitan Washington Airports Authority is spending $7 billion on improvement projects at Washington Dulles International Airport and Reagan National Airport. Much of the investment is going to Dulles, where airport officials expect annual passenger traffic to increase from about 24 million people now to about 35 million by 2016.

“I think it's quite natural, given the hub around the airport and high business travel,” she said.

Two developments in the Loudoun section of the Dulles corridor that are in the works will add huge amounts of office space – Moorefield Station, planning 9.75 million square feet of commercial space, and One Loudoun, planning 3 million square feet of office space. Both projects have plans for hotels in the sprawling communities and expect a lot of business-travel traffic.

Another large development that will bring in significant office space on the Route 28 corridor is the Corporate Office Park Dulles Town Center by Lerner Enterprises. When complete, this area will house over 4.5 million square feet of office space.

As office space has increased, hotels have followed.

Fairbrook Hotels, a Herndon-based company, has applied for a 60,000-square-foot hotel on Lee Road, attracted by the increasing office space along the Dulles corridor and U.S. 50, said Vinay Patel, president of the company. Demand is already driving up prices enough that developers can justify building more hotels in that area, Patel said.

Todd Kaufman, Loudoun County assessor, said that while the real estate market is slowing, developers will take this time to purchase land.

Hobie Mitchel, developer of the Lansdowne community, agreed, saying that he hasn't seen a rise in prices on raw land, so developers will take this time to plan out future opportunities.

“If you're going to build, now is a great time to do it,” said Gerald Gordon, president of the Fairfax County Economic Development Authority. He said it takes several years to construct hotels and, once they are completed, the market could be healthy again.

Tom Maskey, vice president of The Peterson Cos., said hotel occupancy has softened recently, but the market is still “pretty good simply because it is in the Washington, D.C., area.”

Both Gordon and Maskey say Dulles Airport contributes to the need for more hotel space. Even when business travel is slow, nonprofits and trade associations continue to use the airport, Gordon said.

There is some fear among developers that there will eventually be a surplus of hotel space around the airport, Patel said. “But we're in this for the long run, and once business picks up, everything should be OK.”



Del.icio.us




You must be logged in to post a comment.